At Southern California Trusted Realty Associates, we help borrows navigate the waters of a reverse mortgage. Regular mortgages have you paying the lender a set amount every month in order to buy your home over time. Typical lengths of mortgages can be anywhere from 7 years through 40 years. With a reverse mortgage, you instead get a loan that has the lender pay you. A reverse mortgage takes some of your home equity and converts it into payments to you. You essentially loan the lender a portion of your home equity which they pay you back in regular installments. Essentially it is a like having an advance payment on your home equity. The money you receive is typically tax free and you generally do not have to pay back the money as long as you continue to live in your home. Only after you pass away, choose to sell your home, or decide to move out would your spouse, yourself, or your estate need to repay the loan. Sometimes folks decide to sell the home in order to repay the loan. Given the current value of homes in your local Canoga Park California area, one can imagine most have built a nice bit of home equity given the housing market as of late.
There are three basic kinds of reverse mortgages. The first is a single purpose reverse mortgage. These are typically offered by some state and local government agencies and some non-profits. The next type of reverse mortgage is a proprietary reverse mortgage. These are private loans made to you. The last kind of reverse mortgage are federally insured reverse mortgages. These are also called HECMs (Home Equity Conversion Mortgages).
If you are considering any kind of reverse mortgage, you will be getting a new loan that has you borrow against your existing home equity. You will be able to keep the title to your home. In lieu of paying mortgage payments monthly, you instead will be getting an advance payment from the lender on some of your home equity. This money you receive is usually not taxable and generally will not affect Social Security or Medicare benefits. Southern California Trusted Realty Associates can help you identify the right reverse mortgage for you. We have helped many Canoga Park California home owners in obtaining a reverse mortgage. Only upon the death of the last surviving borrower, owner selling the home, or once the owner no longer lives in the home as a primary residence, does your loan has to be repaid. In special situations, a non-borrowing spouse may be able to remain in the home. Call us today to explore all the reverse mortgage options for your situation.
We would love to speak with you so please don't hesitate to reach out if you have any questions or comments.